With the official launch of the ASEAN Economic Community (AEC) in 2016, Indonesia's fruit industry will face fiercer competition. The ACE requires member countries to have a high degree of freedom in their traders, so Indonesia's tropical fruit industry will be severely challenged not only in other ASEAN export markets, but also within Indonesia itself. Kafi Kurnia, head of Assibisindo, the Indonesian Association for Fresh Fruit and Vegetable Imports and Exports, said: "Although there is a huge potential for fruit exports in Indonesia, exports are still very small. The Indonesian government is to blame for this because it has failed to develop fruit as a major export."
Pineapples were Indonesia's top fruit export in 2015, exporting 193,940 tons worth $232 million, according to the Indonesian Ministry of Agriculture. In second place was mangosteen with 38,070 tonnes of exports worth $17.1 million, followed by bananas ($13 million), mangoes ($1.8 million), oranges and durians. There is strong demand for tropical fruits from Indonesia in markets such as the United States, the Netherlands, Spain, Japan and the Middle East.
According to analysis, there are mainly the following factors hindering fruit exports in Indonesia. First, Indonesian fruit is generally of low quality. Because almost all Indonesian fruit farmers operate on a small scale and lack capital investment, high-quality agricultural machinery, pesticides and fertilizers, as well as advanced fruit growing techniques, they produce low-quality fruit that is unpopular in export markets. Second, Indonesia lacks large fruit-growing enterprises and farms. Then there is Indonesia's lack of a well-developed cold storage and transportation industry, which is crucial to extending the shelf life and quality of fresh fruit. In addition, the logistics cost caused by underdeveloped infrastructure such as transportation is also an important factor. It is a curious phenomenon that one often sees in the market that citrus from China may be cheaper in Jakarta supermarkets than citrus from other parts of Indonesia.
Kafi Kurnia says the Indonesian government should play a key role in solving these problems, just as the governments of Thailand and Malaysia have done. Thailand is now the world's most important exporter of durian, a key reason being the huge number of farms the government has encouraged to grow the fruit (which actually originated in Indonesia). Kafi Kurnia believes the Indonesian government should develop fruit farms to provide high-quality fruit for export.